Koizumi, Susilo to sign investment deal in Tokyo

Koizumi, Susilo to sign investment deal in Tokyo

Ivy Susanti, The Jakarta Post, Jakarta

Japanese Prime Minister Junichiro Koizumi is scheduled to sign an
investment agreement with President Susilo Bambang Yudhoyono
during the latter's visit to Japan later this month.

Japanese ambassador to Indonesia Yutaka Iimura said the
agreement, called the strategic investment action plan, would
allow Japanese investors to start investing in Indonesia's
technology industry.

"In the past, we invested in labor-intensive industry, such as
textiles, but this industry is becoming less competitive and is
losing ground to China. So we're shifting our investment focus to
technology and the products are mainly for export to countries in
the Middle East," Iimura said here on Monday.

Susilo will visit Japan for the first time as president from
May 31 to June 2, where he will meet Koizumi and Emperor Akihito.
Earlier, Susilo will meet U.S. President George W. Bush in
Washington, from May 25 to May 26.

"This visit is important for several reasons. Japan and
Indonesia share the same values -- democracy, market economy,
human rights and rule of law. Also, we want to be a moderate
power and a stabilizing force in the international arena," Iimura
said.

He also said that Japan has been a leading trading partner and
the number one foreign investor in Indonesia.

In 2004 alone, Japan brought US$9,881 million of trade surplus
to Indonesia. In the investment sector, the total amount of
direct investment from 1967 to 2004 accumulated to $283 billion,
topping foreign direct investment to Indonesia at 14.6 percent.

There are 1,000 Japanese companies in Indonesia, employing
200,000 people.

Iimura said that Koizumi and Susilo would also announce the
start of negotiations on the bilateral Economic Partnership
Agreement. The partnership's idea came when the leaders met on
the sidelines of the Asia Pacific Economic Cooperation Summit in
Chile last November, when they agreed to set up an Indonesia-
Japan joint investment promotion forum.

"The agreement will include not only the plan for a free trade
agreement, but also proposals to improve the investment climate,
labor migration and capacity building issues," Iimura said.

"We have not yet talked about a deadline, but we hope it will
be accomplished as soon as possible. We already have a similar
agreements with Singapore, and we are going to finalize
agreements with the Philippines and Thailand," he added.

He said that Japan was seeking to cooperate in the areas of
maintaining safe navigation in the Malacca Strait and also
disaster preparedness.

He said that Japan wished to share its experience in managing
disasters, but Japan would also join France and Australia who had
showed interest in cooperating in this area with Indonesia.

Iimura said that Japanese and Indonesian leaders would also
discuss issues related to the East Asian Summit, which is
scheduled to be held in Malaysia later this year.

The U.S. State Department said on Monday that Bush and Susilo
would meet on May 25 to discuss tsunami relief and
reconstruction, as well as ways to strengthen further
cooperation.

It said in a press statement that both leaders met on the
sidelines of APEC Summit last year, but this would be Susilo's
first visit to the U.S. after being elected president last
October.